I think we’d all agree March was a very therapeutic month. The days got longer, the sun shone a little brighter and – oh, yeah – Katie Brown settled the age-old dispute of you vs. them. Of course I’m talking about your in-laws, in case you didn’t know.
Apparently, there’s only one thing that’s (maybe) more difficult than your future in-laws – managing money – and Miz Brown seems to have a pretty good handle on that, as well. (Seriously: is there anything in the realm of matrimonial bliss – or wedded unbliss – this woman doesn’t know or can’t solve?)
According to the Southern Weddings relationship guru, just talking about how you and your other half will handle the family finances means you’re already well on your way to a life in the black. She’s got more advice – natch – so keep on reading. And, as always, don’t forget to hop on over to Katie’s own blog, Confessions of a Young Married Couple, for some more one-on-one time with the woman I like to think of as my personal therapist. (She’s a whole lot cheaper, too!)
How did you go about combining your bank accounts and finances when you first got married? Was that a struggle in your relationship?
Money is a struggle whether you are a sixteen-year-old babysitter managing your cash flow or you are a 65-year-old retiree trying to plan for a casino vacation. And no matter what end of the spectrum you find yourself, the first thing to remember about money is that you can’t take it personally.
I know, I know. It’s your money. Of COURSE its personal. And I’m not saying that it isn’t personal. I’m just saying you can’t take it personally. Having the discussion (and subsequent discussions throughout the rest of your marriage) about money is already hard, but it helps to talk about it as if the two of you are starting a small business. And you sort of are. Operating a family budget makes you the CFO of your own company, your own little empire. And you can’t be a good CFO if you take every discussion about money personally.
When Chris and I got married, we had been dating for six years. We had grown up together. I knew where he kept his toenail clippers and what he put on his hamburger, but I knew nothing about his finances. I knew that, like most of us, he had struggled to get through college. Money had been tight and his family hadn’t been able to help as much as they wanted. But I never asked where he got all his money. For all I knew, he was running an underground gambling ring in his basement at night.
Turns out, it was worse.
Chris made up the difference between what his parents could provide, what cash he could make and what he needed to live by charging everything to his credit cards. When we finally sat down to talk about our finances about two months before our wedding, I almost fainted.
I was fortunate that my parents had been able to put me through school. I had a steady job through college that paid for my spending and gas, but my parents really took care of everything else.
(Go ahead and hate me. I’ll wait.)
What that meant was that I brought no debt into my marriage. But I also brought very little understanding of budgeting either. I had never really had to budget much before. My mom is in banking and she made sure I knew how to handle money, but I always knew that my parents were there as my security blanket, so the budgeting part of her lectures went in one ear and out the other.
One afternoon, Chris and I talked about our money. We laid out all of our (well, his) debt and all of our income and cash. For our marriage, we decided it would be best to pool our money into one checking and one savings account for us to share. With Chris getting ready to enter graduate school and my income soon becoming our sole income, it just made more sense that it should all come from one place. So, we opened our two little accounts, put all our money into them, and together we talked about how we were going to get rid of Chris’ credit card debt ,which, at the time, was around $7,000.
We set our financial priorities, and eliminating credit card debt before we moved across the country to Connecticut in six months was the first on our list. So, we did what we had to do. We moved into Chris’ dad’s house for the summer and we both got summer jobs. We put every single penny we made towards credit card payments.
Chris started graduate school in September, and by August we had paid off everything he owed on his credit cards.
What I learned through those first months of marriage and managing money with Chris was that just because I was the one who came into the relationship with fewer financial problems didn’t mean that I got to make all the decisions. It didn’t even mean that I was the most qualified to make all the decisions. Chris had lived on a budget all through college and that was something he would eventually teach me how to do in our marriage. And where Chris had mismanaged his money and made poor decisions in his budgeting, I was able to teach him the lessons I had learned from my parents about saving and investing.
The important thing to remember when you’re handling money as a couple is that one of you isn’t right and one of you isn’t wrong. You’re a small business now, remember? And like any small business, you will each bring valid ideas and concepts to your relationship as well as to your financials. But you have to be open to listening and discussing those concepts first.
A lot of couples shy away from discussions about money altogether – either because they don’t know how to have the conversation or because they are ashamed of their financial history.
Let me tell you. It needs to be discussed. Whether you are sharing money or not, your financial status is part of your marriage and should be discussed. So, as hard as that conversation will be for some people, you have to just sit down and do it. There were a few things I found during our first talk about money that really helped us have an open conversation:
1. Don’t go too far into your partner’s financial history. I found that what made that initial conversation easier for Chris and me was to not give too much history. I didn’t want to know why there was a charge for $2,000 at Best Buy on his credit card. Start fresh with your marriage. Don’t waste the time and energy focusing on past issues that can’t be changed. Instead, focus on how you want your financial future to be established.
2. Establish financial priorities from Day One. When Chris and I first talked about our money, we started the conversation by talking about where we wanted to be in 20 years. What kind of lifestyle did we want? Where did we want our careers to be? What would our family values be? By working backwards from that shared end-goal, we were able to identify the priorities we would need to have in order to achieve that 20-year plan. But realize that you should have a discussion and re-evaluation of your financial goals at least once, if not twice, a year. Money is fluid, and so should your financial plan.
3. Be kind. This is the one I struggle with the most. Sometimes, we get so comfortable talking with our partners that we let down our hair a little. We’re a little more to-the-point, a little more direct, a little more unfiltered. And that actually is a wonderful thing in a relationship. You should always be able to talk openly and honestly about things in your marriage. But remember that when you are talking about money, and especially about someone’s financial history, you need to be kind. This isn’t the conversation where you can chastise or belittle or judge. You can do those things later when your husband chooses to come home with a $300 beer light that he wants to put up in your living room. (That, sadly, is a true story for me, by the way…) When you’re talking about your personal finances, though, be nice. Be respectful. Remember that you are a small business and try to use that to guide your discussions.
In your marriage, you will experience so many times when you will have to take two heads and form one path. But nowhere is this more important than in your discussions about money. With honesty and respect and maybe a couple bottles glasses of wine, your financial plan can be the next great step forward in your relationship.
Love Katie as much as we do? Want to see more pictures of her handsome hubby and cutie-pie baby? Visit Confessions of a Young Married Couple for your daily dose of sanity!